Does trade policy only have a small impact on trade flows? Interwar evidence

I have been working for a number of years on interwar trade policy, trying to see if using more fine-grained data will alter the consensus view that 1930s protectionism didn’t matter much for trade flows, in the context of everything else that was going on at the time. It is time-consuming work, but we are beginning to produce some results now, the first of which are previewed here. And I suppose that one upside of the time it has taken us to put the dataset together is that, in the meantime, Brexit intervened, which will hopefully increase interest in quantitative studies of trade policy!

Cheltenham Success and Funding

The 2017 Cheltenham Festival ended last Friday and proved to be a remarkable four days for horse racing in this country. Irish trained horses won 19 of the 28 races, beating last year’s previous best of 15. For the second year running there were more Irish trained winners than English, which is all the more remarkable given that “15 Irish winners or more” could be backed at odds of 4/1 as late as Tuesday morning. Irish trained horses won 3 or the top 4 prizes, and Ireland also dominated the leading trainer and jockey tables.

Much of this success can probably be put down to state investment in the sport. From 2008 to 2017 Revised Estimates of Public Expenditure show that the Horse and Greyhound Racing Fund was allocated just under €650 million through the Department of Arts, Sports and Tourism and more recently the Department of Agriculture, Food and the Marine. Of this, Horse Racing Ireland (HRI) received just over €500 million.

While national hunt racing is just one part of the sport, the majority of this funding is used to subsidise prize money at the 26 race courses on the island of Ireland. HRI support equates to roughly two-thirds of the prize fund, with owners, sponsors, funding from Northern Ireland and the European Breeders Fund contributing the remainder. The HRI 2016 Factbook discusses the recent improvement in most indicators in the sport, with only the trend in on-course bookmaker numbers a current cause for concern. The reason for this is largely explained by technological innovations and the resulting rise in online gambling.

The funding of horse racing can be compared to all other sports. Sport Ireland (formerly the Irish Sports Council) is partly responsible for these (their website lists more than 60 sports) and received just over €550 million for the ten-year period from 2008 to 2017. This includes payments to the National Sports Campus from 2012. This equates to a 94 cent investment in Horse Racing Ireland (administering a single sport), for every €1 investment in Sport Ireland, which covers everything from angling to wresting.

While the 2017 Revised Estimates indicate the Horse and Greyhound Racing Fund will surpass its pre-crash allocation this year, Sport Ireland will experience a drop in funding year-on-year. If the country wishes to replicate the remarkable performance of Irish national hunt racing in other sports, further investment in Sport Ireland should be priority.

Continued success in the Cotswold can be expected in the years ahead.

Conference notification

The Central Bank and the European Investment Bank will jointly host a conference on “Investment and Investment Finance: Funding Growth and Recovery in Europe” on the morning of April 10th in the Bank’s new premises, North Wall Quay.

The following speakers are confirmed, and a full programme will be available on the Bank’s website in the coming days:

  • Michael Noonan, T.D., Minister for Finance
  • Prof. Philip R.Lane, Governor of the Central Bank of Ireland
  • Andrew McDowell, Vice-President, European Investment Bank
  • Gabriel Fagan, Chief Economist, Central Bank of Ireland
  • Debora Revoltella, Chief Economist, European Investment Bank
  • Danny McCoy, CEO, IBEC

Further information is available here.

Call for papers: 5th Annual NERI Labour Market Conference

Maynooth University
Friday, 12 May 2017

The fifth annual NERI Labour Market Conference will be held on Friday 12th May in association with Maynooth University’s Department of Applied Social Studies, the Department of Economics, Finance and Accounting and the Department of Sociology. The conference will run from 10:00am-16.00pm and will include research papers on various aspects of the Irish labour market and Irish labour market policy.

The NERI Labour Market Conference is intended to provide a forum for the presentation of research papers on labour market issues (North and South) and is held in May each year. Presentations from researchers, academics, and labour market practitioners are invited for this forthcoming conference. Those interested should submit a title and brief abstract (max 400 words) to tom.mcdonnell@nerinstitute.net

Possible topics include but are not limited to:

• Employment and Unemployment
• Precariousness and Low Pay
• Earnings and Labour Costs
• Productivity and Human Capital
• Labour Market Participation, Demographics and Labour Supply
• Labour Market Institutions (Minimum wages and collective bargaining)
• Labour Market Transitions, Migration, Age and Gender
• Pensions and Pensions Policy

Registration

The conference is open to all who are interested and is free to attend. However, you must register your intention to attend the conference by contacting info@nerinstitute.net

Key Dates
Submission Deadline:
31 March 2017
Registration Deadline:
5 May 2017

Notification of Acceptance:
14 April 2017

Conference Date:
12 May 2017
Contact: tom.mcdonnell@nerinstitute.net

The outward re-orientation of the 1950s and 1960s

T. K. Whitaker has been much eulogised over recent times, and rightly so. But, as he recognised himself in later life, he had not been infallible (is anyone, ever?) and others whom he opposed at the time deserved credit for their part in the outward re-orientation of the economy in the 1950s and 1960s.  In an article just published in the Dublin Review of Books, I offer an assessment of his significance over the period.

We have to prepare for the worst

Colm is in good form in the Independent today. I had exactly the same response to the BBC programme on Brexit as he did.

There are at least three reasons why I think an “off the cliff” Brexit is the most likely outcome.

First, and most importantly, an “off the cliff” Brexit is what the hard Brexiteers want: a break with the EU that is as clean and as unambiguous as possible. And they are currently driving the show. Arguments about economic interest have no impact on this group: for them, it is all about sovereignty, as they see it.

Second, the key Brexit ministers are clearly not on top of their brief. They assure us that jumping off the cliff will be fine, and then it emerges that they haven’t studied what its consequences would be: it is surreal stuff. Check out this clip of Brexit minister Davis, if you haven’t already, and remember: this is the man tasked with negotiating Brexit.

Third, while UK civil servants are very competent, there are only so many of them. If all off the shelf transitional arrangements are ruled out on theological grounds (having to do for example with the ECJ) then it is hard to see how bespoke arrangements can be sorted out within two years, even if ministers understand what needs to be done, and even if they want to do it.

Hopefully I will be proved wrong, but we have to assume the worst and prepare for it. That means not putting all our intellectual, political and administrative energy into fighting amongst ourselves as to what the best deal should be: there may not be one at all, simply because the UK doesn’t want one or isn’t capable of delivering it. It means thinking about the people who will be hurt — people working in small businesses exporting to the UK, primarily, but also people living in border regions — and about how the State and the EU can help them to adjust.* It means targeting every British food processing firm that may find itself at a competitive disadvantage in the EU post-2019 and seeing if they can be induced to invest in Ireland (outside Dublin, which is where we will need the jobs). It means becoming more granular: listening more to the industries involved, and solving specific problems one at a time. It means the rest of us abandoning the “I’m alright Jack” mentality that often pervades Irish discourse, and all of us realising that we really are in this together.

*And, even though I guess it is special pleading, spare a thought for cross-border workers. The pre-1973 CTA won’t be enough, I imagine, to replicate current arrangement.

 

Update: Wolfgang Münchau takes the polar opposite view, here. Hopefully he is correct!